HR REWARD AND BENEFITS
grounded in the strategic objectives of the business
the reward agenda by ensuring reward is
HR directors become part of not just a cost, but Joris Wonders/Towers Watson
creates touch every aspect of business, from finance to facilities. The threat looms that the wrong decisions will be made by the wrong people. The challenge for the HRD is to ensure their reward plans
have the ear of those that matter in the C-suite. But evidence suggests this might be easier said than done. So how can HR directors ensure ‘reward’ gets the attention it deserves on the board, as the economy remains precarious? Joris Wonders, head of the UK reward practice at HR
consultancy Towers Watson, thinks the problem stems from reward being seen by board members solely as a cost. “Boards need to look not just at how reward costs are
managed,” he says, “but how they are measuring the value of that spend. For example, I don’t know if boards are discussing reward as much as other business issues such as IT or infrastructure – they need to see reward as an investment.” Richard Baker, MD and founding member of Robert Half
International Executive Search in the UK, explains the HR director would not – and should not – be a permanent member of a remuneration committee. “The remuneration committee has got to be independent
of the business,” he says. But he adds: “The role of HR directors, as the custodians of fair play in a business, is to advise the remuneration committee and they should push to be invited to meetings. Here there is a role for the HRD, not to set policy, but to provide empirical data.
hrmagazine.co.uk “In the past, staff in the finance sector have been rewarded
for taking huge risks and this is unfounded. The HRD can have a role beyond this to make recommendations to change things. The HRD should be working with departments such as procurement and finance to make sure the reward and benefits systems in place are cost-effective, fair and still attract and retain the best people.” Baker admits, though, that HR can no longer ‘ring-fence’
reward and benefits, because the strategies around it belong to more than one department in the modern workplace. But he argues this doesn’t mean there are not other aspects
of HR strategy HRDs can bring forward to have an impact and an influence. He explains: “HR directors know how workplace trends are
forming and they know that people in generation Y would now perhaps choose to take work/life balance benefits before bonuses. “They also know that, as high as the cost of reward might
be, recruitment costs can be greater. HR directors need to benchmark reward against peers and they could come up with strategies to recruit better staff, but in lower numbers, so pay could remain competitive, but pay costs would be saved overall.” Wonders agrees: “HR directors become part of the reward
agenda by ensuring reward is not just a cost, but grounded in the strategic objectives of the business. They need to pose the
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